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CHAWALA FOOTWEAR, LAHORE vs COMMISSIONER INLAND REVENUE, LAHORE S — 2025 PTD 574 SUPREME-COURT

Case information

Citation
2025 PTD 574 SUPREME-COURT
Court
Supreme Court of Pakistan
Year
2025
Reporter
PTD
Parties
CHAWALA FOOTWEAR, LAHORE vs COMMISSIONER INLAND REVENUE, LAHORE S
Subject matter
Tax & Customs
Provisions referred to
S. 161---I; Income Tax Ordinance

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

Judgment text as reported

CHAWALA FOOTWEAR, LAHORE VS COMMISSIONER INLAND REVENUE, LAHORE S.161---Income Tax Rules, 2022, R. 43---Withholding tax, non-deduction of---Show cause notice---Fishing inquiry, principle of---Applicability---Appellant/taxpayer was aggrieved of show cause notice issued by authorities to initiate proceedings for not deducting withholding tax---Validity---If a taxpayer fails to collect or deduct tax from payments made during a tax year, such inaction is deemed as a default under section 161 of Income Tax Ordinance, 2001---Point that sets into motion the machinery of section 161 of Income Tax Ordinance, 2001 to determine tax liability is the failure to either collect tax or deduct it---Show-cause notice highlighted discrepancies in valuation of imports and specified categories under which tax was applicable---This indicated that there was careful consideration of any failures to deduct tax, along with an assessment of underlying bases and amounts involved, therefore, the notice was not simply a fishing expedition---Supreme Court declined to interfere in the judgment passed by High Court as demand created against appellant/taxpayer was well-founded---Appeal was dismissed.

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